Economists polled by Reuters had forecast factory orders advancing 1.0 percent in February after a previously reported 1.2 percent increase in January.

Factory orders were up 4.6 percent from a year ago.

Shipments of manufactured goods increased 0.3 percent after a similar gain in January. Manufacturing, which accounts for about 12 percent of the U.S. economy, is recovering in part as steadily rising oil prices reinvigorate the energy sector, leading to demand for machinery and other equipment.

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The Commerce Department also said orders for non-defense capital goods excluding aircraft -- seen as a measure of business confidence and spending plans -- dipped 0.1 percent as reported last month.

Shipments of these so-called core capital goods, which are used to calculate business equipment spending in the gross domestic product report, jumped 1.0 percent, also as reported last month.

The rise in shipments suggests an acceleration in business spending on equipment in the first quarter after it increased at a 1.9 percent annualized rate in final three months of 2016.

Unfilled orders at factories were unchanged after falling for three straight months. Inventories of goods at factories rose 0.2 percent in February. They have increased in seven of the last eight months. The inventories-to-shipments ratio was 1.31 in February, unchanged from January.